CNV Proposes Changes to the Bookkeeping Procedure of Certain Issuing Companies

On August 3, 2022, the Argentine Securities Commission (CNV) issued General Resolution No. 938, which submits a draft resolution for public consultation to unify the criteria applicable to financial statements of issuing companies using foreign functional currency. The draft resolution includes those companies that have implemented an accounting policy for “Other Integrating Results” generated by the spread of foreign exchange on the “Reserved Profits” and “Unallocated Results” accounts.

The Draft Resolution proposes that, to determine the amount that must be allocated to the Legal Reserve on each financial year, the issuing companies mentioned above should also consider the foreign exchange spread generated by the Unallocated Results and Reserved Profits accounts, appropriated from the accounts originating such results.

Further, the foreign exchange spread originated in the Capital account, Adjusted Capital, and Legal Reserve should be taken into account to determine the limit of the Legal Reserve corresponding to 20% of the issuing company’s capital.